Tiny Target planned for Seattle – is Smallmart next?

Target Corp. recently announced it will open a small store in downtown Seattle, part of a one-size-doesn’t-fit-all plan to open 10 small stores in urban areas during the next few years.

But what about Walmart?

That retailer has quietly admitted to a small-store plan of its own recently, though Seattle hasn’t been mentioned as a possible location. Retail analysis say Walmart is likely to debut the scaled-down stores in the urban Midwest.

Small stores aren’t a new concept for the Arkansas-based retail chain; Walmart has had Neighborhood Market grocery stores for several years. But now, the company plans to test small stores similar to ones it operates in Latin America, according to Supermarket News.

The company’s Latin-American stores range from small grocery outlets to larger mixed-retail spaces.

Specific plans for Walmart’s small-store plan in the U.S. will be unveiled at an analysts meeting in October. But some are already speculating the company could open as many as 400 small stores every year for the next 10 years.

Analysts seem to agree that this is a good time for Walmart to follow in Target’s footsteps, largely because the cost of urban commercial real estate is lower than usual right now.

Target will open its first smaller-format store in Seattle in 2012. That store will be about 90,000 square feet, roughly half the size of a traditional Target retail space.

Walmart’s small-store format could be smaller still. Real estate experts are guessing the chain’s plan will be to open stores that span about 20,000 square feet.

Competition between Target and Walmart could be getting more intense soon; Target plans to sell fresh produce at more than half of its stores by the end of next year.